Richard Perez, Linda Anne Burtis, Tom Hoff, Sam Swanson, Christy Herig

Quantifying Residential PV Economics in the US: Payback vs Cashflow Determination of Fair Energy Value

Payback is often used as a measure of profitability by prospective PV owners. Contrasting this measure with another financial gauge -- life-cycle cash flow -- the paper discusses why payback may not be the most appropriate measure for residential PV applications and why it may hide sound financial opportunities for those deciding to invest in a PV system. In parallel, the paper addresses another aspect of economic feasibility: the value of energy produced. For residential applications, this value is currently set at residential net-metered retail rates. We present preliminary evidence that a higher value, reflective of the local effective capacity of PV ought to be claimed for residential PV applications.

Click to download

Alternate download location